Friday, June 18, 2010

On June 15, 2010, four indictments were unsealed in the Eastern District of New York charging 17 individuals for their participation in alleged health care fraud and money laundering schemes in the Eastern District of New York.In addition, 12 durable medical equipment (DME) retail companies located in South Brooklyn that were operated by the charged individuals were searched.

Four of the DME businesses in Brooklyn that were searched were Kristar, Inc., Promed Supply Co., Inc., Dorsi Medical Supply Inc.,
DB Supply Inc./Avgur. The government also seized assets from bank accounts maintained by the retail DME companies owned by the charged individuals.

It must be remembered that the charges announced by the U.S. Attorney's Office today are merely allegations, and the defendants are presumed innocent unless and until proven guilty.

According to the indictments, the DME company owners and operators filed fraudulent claims with private insurance companies with no-fault insurance plans. Specifically, it is alleged that the DME companies submitted false invoices for durable medical equipment to the insurance companies in two ways: (1) by charging prices well in excess of the price paid by the companies, and (2) by billing for equipment that was never obtained.

There is a money laundering allegation as well since the indictments allege that the charged individuals engaged in financial transactions to conceal the identity, source, and destination of the fraudulent proceeds by “laundering” them through checks they issued to the same wholesale companies. The checks were then negotiated at check cashing stores and the resulting cash was delivered back to the defendants.

In New York, there is no fault accident insurance. Health care fraud prosecutions are now proceeding beyond Medicare and Medicaid and are targeting private insurance companies. What appears to be alleged in this case is that the DME companies alleged that the price to the wholesale companies was more than charged, that the DME companies issued false invoices, the insurance companies sent checks to the wholesale companies, and then the wholesale companies cashed the checks at check-cashing stores. At that point, it is alleged that the cash funds were delivered back to the individuals charged.

How does the government prove such a case? Usually through subpoenaed bank records and a forensic accounting probe. This means that witnesses are not necessary and it becomes a paper case. In order to evaluate the liability or exposure on such a case, analysis of these records by defense counsel is necessary.

The mark-up allegations are aggressive and are usually charged as a means of showing how kickback or other fraudulent schemes exist. Large mark-up is not in and of itself against the law but is a factor that is considered on whether there is health care fraud. In some occasions, the large mark-up is used to explain how the extra money made is used for kickbacks or referral fees.

The firm focuses its practice on the representation of licensed professionals, individuals and businesses in civil, business, administrative and criminal proceedings. They have a specialty in representing licensed health care providers and in health care fraud related matters in California and throughout the country. Their website is: http://www.greenassoc.com/

DISCLAIMER

DISCLAIMER: Green & Associates' articles and blog postings are prepared as a service to the public and are not intended to grant rights or impose obligations. Nothing in this website should be construed as legal advice. Green & Associates' articles and blog postings may contain references or links to statutes, regulations, or other policy materials. The information provided is only intended to be a general summary. It is not intended to take the place of either the written law or regulations. We encourage readers to review the specific statutes, regulations, and other interpretive materials for a full and accurate statement of their contents and contact their attorney for legal advice. The primary purpose of this website is not the commercial advertisement or promotion of a commercial product or service and this website is not an advertisement or solicitation. Anyone viewing this web site in a state where the web site fails to comply with all laws and ethical rules of that state, should disregard this web site.

The information provided on this website is for informational purposes only. It is not intended to create, and does not create, a lawyer-client relationship with Green & Associates, Attorneys at Law. Sending an e-mail to Tracy Green does not contractually obligate them to represent you as your lawyer, or create any type of client relationship. No attorney-client relationship will be formed absent a written engagement or retainer letter agreement signed by both Green & Associates and client and which specifies the scope of the engagement.

Please note that e-mail transmission is not secure unless it is encrypted. E-mail messages sent to Ms. Green should not include confidential or sensitive information.

Our Firm's Practice Areas

We are attorneys who specialize in vigorously representing individuals, businesses and licensed professionals in administrative, civil, business, regulatory, health care and criminal matters. All communications are attorney-client privileged - even initial consults. Lawsuits and legal problems can cause great stress for the most sophisticated business people and individuals. Having a trusting relationship with our clients helps them see that they will get through it no matter how difficult it may seem at the moment.

We advise businesses and individuals on compliance plans and structuring businesses to comply with governmental regulations. As needed, we conduct internal and external investigations and audits, and tailor our representation for each individual client whether a business or individual. We are non-judgmental and experienced which means we have seen it all in over 25 years of practicing law.

We believe it is critical that clients understand their legal issues, set goals, identify and understand any obstacles and that we work as a team to address, prevent and solve any legal problems including civil, administrative or criminal investigations and cases.

Directions To Our Office

The office is located on the southwest corner of 6th & Flower in downtown Los Angeles. (The Standard Hotel is on the northeast corner of 6th and Flower.) The address is 800 West Sixth Street, Suite 450, Los Angeles, CA 90017. It is close to the interchange at the 110 and the 10 freeways.

Parking will be valet at our building or parking at a nearby lot. Call for detailed information. We validate for our clients & make it easy to come to DTLA. Use your visit to go to nearby restaurants and explore downtown Los Angeles.

In using navigation, make sure you use the zip code 90017 since there is a similar address in San Pedro area of Los Angeles.

Security Procedures: Our building's security system requires all visitors to check in with the security desk before proceeding to the Firm. You may want to allow yourself an extra few minutes for this process.

Searching Our Blog

Total Pageviews

Subscribe To

Information About Subscribing

We post at varied times depending on our busy lawyers' schedules. Subscribing eliminates the need to check back unnecessarily. You will receive an email alert each time we post. You can easily remove your address from our list at anytime. The list is managed by several popular feed readers and is not used for any other purpose. You will not receive any unsolicited email and we will not have your email information.